Amirabbas Farnoudi; Mohamad mahdi Asgari; Mahdi Sadeghi Shahedani; Ali Taheri Fard
Abstract
In this article the rate of return (ROR) and risk factors faced by international oil company (IOC), in IPC contract of Darkhowein oil field is modeled. For this purpose, we analyze the IPC contract specific risk factors that can contribute to a reduction in the rate of return for the international oil ...
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In this article the rate of return (ROR) and risk factors faced by international oil company (IOC), in IPC contract of Darkhowein oil field is modeled. For this purpose, we analyze the IPC contract specific risk factors that can contribute to a reduction in the rate of return for the international oil company including oil price, production level, capital cast, operating cost, and remuneration. The results of the cash flow risk analysis show the impact of these factors on the contractor's rate of return on IPC contracts is not significant in comparison to Buy-back contracts. The most important risk factor in Buy-back contracts is capital cast, which affects a large part of the contractor's returns, but in these contracts, this risk has been significantly reduced due to the government's additional compensation. In general, according to the results, it can be said that in IPC contracts, the contractor's return rate has not been heavily influenced by risk factors, and therefore the risk of the international oil company has fallen in these contracts.
Ali Emami Meibodi; Ahmad Hadi
Abstract
One of the main ways of domesticizing technology in oil industry is conditional contract for transfer of technology from international oil companies. However, over the past years the Iranian oil industry has made a little success in this regard and presently in Iranian new petroleum contract (IPC) as ...
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One of the main ways of domesticizing technology in oil industry is conditional contract for transfer of technology from international oil companies. However, over the past years the Iranian oil industry has made a little success in this regard and presently in Iranian new petroleum contract (IPC) as an alternative to buy back contracts aims to acquire and transfer modern technologies and localize it by collaboration of international oil companies with domestic companies approved by the National Iranian Oil Company, by making some changes in the type, terms and nature of contract. But what is more important than technology transfer is consideration to the obtained results compared with decisions made on the technology transfer of a contract. Thus, evaluation the risk of technology transfer play a clear and prominent role in the future sustainable development of Iranian oil industry. In this study, in addition to the study on buy back and IPC contracts from technology transfer point of view, the risks of technology transfer are detected in IPC contract and discussed by reviewing experts’ opinions. Next, by using FMEA parameters, identified risks are scored and for each RPN is calculated and finally they are prioritized. The highest priority of risk was given to the negative results of oil engineers and experts separation from the National Iranian Oil Company (RPN=576), followed by the effect of the presence of international oil companies in the destruction of the endogenous growth of national oil industry (RPN=448). Considering the high rate of risk in most identified risks, control measures were presented according to experts’ opinions in order to reduce the level of the risks.
Mohammad Reza Shokouhi; Mahsa Soleimani; Rasoul Sheikhinezhad moghaddam; Aye Katebi
Abstract
In this paper, utilizing a cash flow model in an Oil field as a case study, we compare the efficiency of fiscal regimes of buy back and Iranian Petroleum Contract (IPC). In order to implement the mentioned comparison, we have selected influential financial indices such as: internal rate of return (IRR), ...
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In this paper, utilizing a cash flow model in an Oil field as a case study, we compare the efficiency of fiscal regimes of buy back and Iranian Petroleum Contract (IPC). In order to implement the mentioned comparison, we have selected influential financial indices such as: internal rate of return (IRR), Net Present value (NPV), Payback period, Profit to investment ratio (PIR) and Government take (GT). Furthermore, considering three price scenarios, sensitivity analysis is performed for different oil prices. Subsequently, we model IPC comprising Enhanced Oil Recovery (EOR (/Improved Oil Recovery) IOR) operations and compare it with IPC without EOR/IOR in terms of the specified indices. Our results indicate that in addition to the more eligibility of IPC for contractors than buy back contracts, Government take is still adequate and noticeable enough in spite of the reduction it would confront in IPC. The paper concludes IPC comprising EOR/IOR is more beneficial to host government than E&P companies, therefore contractors do not have sufficient incentives to apply EOR/IOR operations in which the host government should lead the contractor toward by providing them with mutually acceptable options.
